The Family Springboard Mortgage will allow first time buyers and home movers to purchase a home without a deposit. This requirement for deposits and the huge rise in house prices has been a major barrier for many would be buyers within the UK, whether trying to get onto the property ladder or looking for their next home.
Family springboard mortgage facts:
- 100% mortgage available to first time buyers and movers
- A family member or guarantor is required to open up a Helpful Start Account and deposit 10% of the properties asking price at the time of the mortgage application.
- The maximum loan amount available is £500,000.
- After a 3-year period the 10% value deposited will be returned with interest providing all repayments have been kept up to date.
- If the buyer misses any repayments during the 3-year period, the bank has the right to retain the family member or guarantor’s money for a further period.
- Fixed rate of interest for 3 years at 2.99%
- Maximum income multiple of 5.5 times a buyer’s income
This is the first 100% mortgage offer to be released since the financial crash in 2008 and until now banks have required buyers to put up a minimum deposit of 5%. It’s to be believed that parents and other relatives are financing 1 in 4 first time buyer mortgages. This new mortgage deal is no doubt appealing to the bank of mum and dad as they will see a return on their investment after a three-year period through the Family Springboard mortgage. This new offering will also be hugely appealing for those living within London and the surrounding areas where house prices have risen dramatically and are much higher than those throughout the rest of the UK.
Raheel Ahmed, head of Barclays Mortgages said: “With over a third of young people still turning to their family for help with buying a home, we have increased the accessibility of the Barclays Family Springboard mortgage. We want to offer more people a way to get on the property ladder and to walk through the door of their first home earlier than they perhaps thought.”
If you would like to know more about mortgages or are looking for your next property purchase visit our website for further information and support.